In 2015, it was reported that the global demand for chocolate was projected to increase but it was unlikely that the global supply of cocoa beans, required to produce chocolate, would increase.

Mark scheme

Marking points from the official mark scheme (May/June 2018). The mark or mark type is shown in brackets.

1. [Up to 4 marks maximum] For knowledge and understanding of two relevant factors of production in the manufacture of chocolate.
2. Award 1 mark for identification and 1 mark for explanation of how this contributes to the production process.
3. (KU: Up to 4 marks maximum)
4. [Up to 4 marks maximum] For an understanding of specialisation and its application to the manufacture of chocolate.
5. [1] For an understanding of specialisation (1 mark) and the division of labour (1 mark)
6. [Up to 2 marks] For the benefits of specialisation and the division of labour
7. (APP: Up to 4 marks maximum)
8. [8] The factors of production are land, labour, capital and enterprise. Each has a distinct role in the production process.
9. Specialisation occurs when workers are assigned specific tasks within a production process. This is usually called the division of labour. Workers will require less training to be an efficient worker. Therefore this will lead to an increase in labour productivity and firms will be able to benefit from economies of scale and increased efficiency.
10. No knowledge of chocolate manufacture is required for full marks on this question.
11. [Up to 2 marks] For an analysis of the impact of the increase in demand and the likely fixed supply on the market for chocolate in terms of price and quantity traded
12. [Up to 6 marks] For an analysis of how the price may be stabilised with reference to the difficulties.
13. (AN: Up to 8 marks maximum)
14. [Up to 4 marks maximum] For an evaluation of the most effective way of stabilising the price of chocolate with 1 mark reserved for a reasoned conclusion.
15. (EV: Up to 4 marks maximum)
16. [12] An increase in demand with a relatively fixed supply will result in a rise in price with no or little extension in supply. The supply will be highly inelastic or perfectly inelastic.
17. Price can be stabilised through a maximum price that might be made effective through buffer stocks. This has several problems including cost and problems of storage.